REDWOOD CITY, Calif.—Shares of Openwave Systems Inc. plummeted after the mobile software developer projected a net fourth-quarter loss and received subpoenas in a broadening stock-options investigation.
Openwave said it expects breakeven results, excluding items, on revenue of $90 million to $92 million during the quarter. The company forecasts a net loss of 13 to 14 cents a share.
The projections are substantially below expected earnings from Thomson Financial Network of 22 cents a share on revenue of $122 million. Openwave said it expects bookings of $122 million on the quarter, and was quick to point to an expected $410 million in revenue for the fiscal year.
“While the results for the quarter are disappointing, overall the company has delivered a solid financial year,” said David Peterschmidt, Openwave’s chief executive officer. “We continue to see customer momentum worldwide and are confident in our strategy as we enter fiscal 2007.”
Investors fled as shares dropped by $3.70, or 32 percent, to $7.77 per share following the disappointing report.
The revised forecast followed Openwave’s disclosure that it received subpoenas from two U.S. attorneys requesting documents related to the company’s practices of granting stock options. Openwave is one of 60 companies ensnared in the investigations, which center on the timing of stock-option grants to key executives.
The firm said it will cooperate fully with the two federal prosecutors’ offices.
